www.pwc.com/technology China’s impact on the semiconductor industry: 2011 update MEPTEC – January 2012 Worldwide semiconductor market by region, 2003-2010 Source: SIA, CCID PwC 2 China's semiconductor market growth, 2000-2010 PwC 3 Comparison of China vs. worldwide semiconductor growth by quarter, 2007-2010 PwC 4 China's IC and O-S-D market growth, 2000-2010 PwC 5 China compared with worldwide semiconductor market by application, 2010 PwC 6 Semiconductor suppliers to the Chinese market, 2009-2010 Rank Revenue in millions of US dollars Market share Company 2009 2010 2009 IC 2010 IC % Change 2009 Semi 2010 Semi % Change Intel 1 1 15,570 19,659 26.3% 15,570 19,659 26.3% 14.9% Samsung 2 2 5,548 8,018 44.5% 5,681 8,175 43.9% 6.2% Hynix 4 3 3,644 5,564 52.7% 3,644 5,564 52.7% 4.2% Toshiba 3 4 3,231 4,138 28.1% 3,904 4,970 27.3% 3.8% TI 7 5 3,127 4,248 35.8% 3,292 4,479 36.1% 3.4% ST 5 6 2,704 3,305 22.2% 3,601 4,449 23.5% 3.4% AMD 6 7 3,415 4,174 22.2% 3,415 4,174 22.2% 3.2% NXP 8 8 2,281 2,965 30.0% 2,891 3,751 29.7% 2.8% Renesas* 12 1,272 1,716 9 2,634 31.0% 3,484 32.6% 2.6% NEC* 18 739 911 Freescale 10 10 2,057 2,788 35.5% 2,436 3,233 32.7% 2.4% Media Tek (MTK) 9 12 2,442 2,453 0.5% 2,442 2,453 0.5% 1.9% Total Top 10 44,019 57,493 30.6% 46,876 61,938 32.1% 46.9% Total Top 10 share of Chinese integrated circuit market 53.0% 52.9% Chinese semiconductor market 46.3% 46.9% Note: Semi equals IC + Discrete (including LED) market. * Renesas for 2010 is compared with Renesas + NEC for 2009 due to their merger. Source: CCID IC Market China 2010 & 2011 Conferences—Feb. 2010 & 2011 PwC 7 China's semiconductor industry revenues and growth, 2000-2010 PwC 8 China's semiconductor industry by sector, 2003-2010 PwC 9 Comparison of China's IC industry sector growth by quarters, 2007-2010 PwC 10 Major Chinese semiconductor manufacturers (including groups) in 2010 Rank Sales revenue (RMB:100M) Sales revenue (US$M) Name of company 2009 2010 2009 2010 Change Sector 2009 2010 Change Intel Products (Shanghai & 122.96 186.13 51.4% P 1,800 2,750 52.8% 1 1 T Chengdu) Co., Ltd. Hynix—Numonyx 106.39 137.86 29.6% 1,557 2,037 30.8% 2 2 I Semiconductor SMIC (Semiconductor 73.09 104.60 43.1% 1,070 1,545 44.4% F Manufacturing 3 3 International Corp.) Freescale Semiconductor 65.98 85.29 29.3% 966 1,260 30.5% P D (China) & (Suzhou) Co., 4 4 T Ltd. RFMD (RF Micro Devices) 52.85 64.37 21.8% P 774 951 22.9% 5 5 T (Beijing) Co., Ltd. XINCHAO Group 42.24 63.89 51.2% 618 944 52.6% DP T 6 6 C China Resources 36.86 45.30 22.9% I D D 540 669 24.0% Microelectronics (Holdings) 8 7 C Ltd. HiSilicon Technologies Co., 39.11 44.16 12.9% 572 652 14.0% 7 8 D Ltd. F Natong Huada 27.20 41.81 53.7% 398 618 55.1% P T Microelectronics Group 13 9 Co., Ltd. Renesas Semiconductor 32.89 39.83 21.1% 482 588 22.2% P T D (Beijing & Suzhou) Co., 9 10 Ltd. Source: CCID, CSIA, GDQ, PwC 2009-2011 PwC 11 China's IC design industry revenue and growth, 2000-2010 PwC 12 Number of IC design enterprises in China, 1990-2010 PwC 13 Major Chinese semiconductor companies by revenue, 2010 Rank Sales revenue (RMB:100M) Sales revenue (US$M) Name of company 2009 2010 2009 2010 Change Sector 2009 2010 Change HiSilicon Technologies Co., 39.11 44.16 12.9% D 572 652 14.0% 1 1 F Ltd. Spreadtrum 7.18 25.00 248.3% 105 369 251.5% 7 2 D F Communications Inc. TianjIn ZhongHuan 5.89 15.02 155.0% 86 222 157.4% 10 3 D Semiconductor Co., Ltd. C RDA Microelectronics, Inc. 8.09 12.81 58.4% 118 189 59.9% 6 4 D F Wuxi China Resouces 8.30 11.39 37.2% I D 121 168 38.5% Huajian Microelectronics 5 5 C Co., Ltd. Jilin Sino Microelectronics 10.88 11.00 1.1% 159 163 2.1% 2 6 D Co., Ltd. C Hangzhou Silan 5.88 10.03 70.5% 86 123 42.9% 11 7 D F Microelectronics Co., Ltd. Shenzhen ZTE 9.88 10.00 1.2% 145 148 2.2% Microelectronics 3 8 D F Technology Co., Ltd. GalaxyCore Inc. 4.25 8.40 97.6% 62 124 99.4% 9 D F Suzhou Good-Ark 5.55 8.33 50.0% 81 123 51.4% 13 10 D C Electronics Co., Ltd. PwC 14 Current wafer fab capacity comparison, China and worldwide PwC 15 Semiconductor Wafer Fab & Foundry Plants in China PwC 16 Comparison of China and all remaining countries' SPA&T resources, 2010 China Rest of world 19.9% Number of facilities 80.1 22.7% Number of employees 77.3 19.6% Amount of floor space 80.4 21.3% Value of production 78.7 Source: Gartner Dataquest 2010 PwC 17 Comparison of China and all remaining countries’ SATS share of SPA&T capacity, 2010 PwC 18 Semiconductor Packaging and Testing Plants in China PwC 19 Comparison of China's IC consumption and production: 1999-2013 PwC 20 China versus worldwide semiconductor IPOs, 2005-2010 PwC 21 Thank you. Presenter name Clements E. (Ed) PAUSA Telephone number +1-408-817-5738 Email address [email protected] PwC’s report “China’s impact on the semiconductor industry 2011 update” can be downloaded at www.pwc.com/chinasemicon PwC 22 Addendum – Backup Slides PwC 23 China's IC design enterprises by employee count, 2010 & 2009 PwC 24 China's IC design industry by process technology, 2010 & 2009 PwC 25 China versus worldwide semiconductor patents, 2005-2010 PwC 26 China versus worldwide semiconductor IPOs, 2005-2010 Total 6 yrs 2005 2006 2007 2008 2009 2010 1Q/11 2Q/11 2005–10 Worldwide semiconductor IPOs Number of IPOs 73 91 69 28 36 42 3 3 339 Proceeds (US$ millions) 3,006.0 3,663.8 3,727.1 678.2 1,693.6 6,202.6 278.5 995.0 18971.3 Chinese semiconductor company IPOs Number of IPOs 5 17 15 1 9 30 1 1 77 % of worldwide 6.8% 18.7% 21.7% 3.6% 25.0% 71.4% 33.3% 33.3% 22.7% Proceeds (US$ millions) 407.9 743.6 1,109.5 37.4 1,308.9 4,493.5 63.0 135.0 8100.9 % of worldwide 13.6% 20.3% 29.8% 5.5% 77.3% 72.4% 22.6% 13.6% 42.7% Chinese market semiconductor IPOs Number of IPOs 0 7 7 1 7 26 0 1 48 % of worldwide 0.0% 7.7% 10.1% 3.6% 19.4% 61.9% 0.0% 33.3% 14.2% Proceeds (US$ millions) 0.0 285.5 351.6 37.4 1,270.7 4,062.5 0.0 135.0 6007.7 % of worldwide 0.0% 7.8% 9.4% 5.5% 75.0% 65.5% 0.0% 13.6% 31.7% Chinese semiconductor company = domiciled in China Source: Thomson Reuters 2010–2011 PwC 27 China's contribution to worldwide semiconductor value chain revenue, 2010 Worldwide China Revenue Sales Consumption China’s role Electronic Design Automation 4.2 N/A 0.31 Software user, not EDA producer Semiconductor Intellectual Property 1.5 N/A 0.12 Licensees by IC design & foundries; not licensor Equipment 39.5 0.10* 3.63 First-tier & wafer-fab buyer; used equipment favored; solar & second or third-tier producer Materials 43.6 0.43* 4.15 First-tier buyer, solar and second or third tier producer IDMs 224.7 18.9 99.6 Plant location for MNC IDMs’ SPA&T & 3 fabs; local source of OSD and smaller IC IDMs Fabless 73.6 5.4 32.4 Small but continually growing local capabilities Foundries 30.2 3.2 13.4 Substantial; 21% worldwide foundry capacity by 2013 SATS 23.6 9.1 10.4 Substantial: about 25% worldwide SATS capacity Totals 440.9 36.6 164.01 * Chinese domestic equipment and materials companies only, without local subsidiaries of foreign companies. Source: CSIA, EDAC, Gartner Dataquest, GSA, SEMI, PwC PwC 28 Greater China share of the worldwide semiconductor industry, 2000-2010 PwC 29 Greater China represents, by 2010 PwC 30 China's export and domestic semiconductor consumption markets Source: Gartner Dataquest, PricewaterhouseCoopers 2009-2011 PwC 31 Analysis of China/Hong Kong consumption vs. purchase (sales to) semiconductor market history PwC 32 Chinese top OEMs by revenue and semiconductor consumption 2009-2010 (US$B) Semiconductor consumption Rank Revenue Purchase TAM (Design TAM) Name of 2009 2010 2009 2010 Change % 2009 2010 Change % 2009 2010 Change % company Huawei 1 1 21.8 27.5 26.0% 2.3 3.4 49.0% 2.3 3.4 48.7% Lenovo 3 2 16.6 21.6 30.1% 3.7 6.1 64.0% 2.8 4.6 67.4% Haier 2 3 18.2 20.2 10.8% 0.3 0.4 41.2% 0.3 0.4 37.3% Great Wall 9 4 Technology 5.4 15.6 187.4% 0.1 0.2 25.6% 0.1 0.1 42.0% ZTE 4 5 8.8 10.4 18.4% 1.5 2.1 41.0% 1.5 2.1 41.1% Hisense 5 6 8.2 8.3 1.6% 0.3 0.3 -0.4% 0.3 0.3 -4.3% Changhong 10 7 4.6 8.1 76.9% 0.2 0.2 9.3% 0.2 0.3 43.5% Founder 7 8 6.4 7.8 22.3% 0.4 0.4 -6.1% 0.3 0.3 -9.7% TCL 6 9 6.5 7.7 19.0% 0.6 0.8 52.3% 0.8 1.1 44.6% BYD 8 10 5.8 6.9 20.1% 0.3 0.4 41.0% 0.3 0.3 3.0% Total 102.4 134.3 31.2% 9.5 14.2 48.7% 8.7 12.9 47.0% % Semi penetration 9.3% 10.6% Midea 6.9 11.1 60.7% Gree 6.2 9.0 45.8% Skyworth 2.9 3.1 6.2% 0.3 0.2 0.3 Konka Group 1.9 2.5 31.1% 0.2 0.2 0.2 Source: MIIT, Thomson Reuters, Gartner Dataquest 2009–2011 PwC 33 China's IC industry revenue and growth, 2000-2010 PwC 34 Selected recommendations • Understand and leverage China’s 12th FYP.